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Rebates and Bankruptcy Don't Mix

By Rich Smith - Updated Apr 5, 2017 at 8:03PM

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Retail bargain-hunters have a problem.

'Tis the season for shopping -- or so my television tells me. But while the consumer-driven economy surely appreciates everyone's efforts to boost spending, things are getting dicey for shoppers this Christmas season -- in ways you might not expect.

It's not enough that we're in the midst of a liquidity crisis. Or that your bank may disappear in the blink of a credit card transaction, taking your bank account with it. Events have now conspired to threaten the most American aspect of the Holiday Shopping Experience -- the sales gimmick.

Specifically, the mail-in rebate.

As Black Friday loomed for retailers and shoppers alike last month, the bankruptcy of a major rebate processor could threaten rebates on a potentially huge number of deals.

Do tell ...
The story goes like this. As a general rule, after you buy something with a mail-in rebate, you're then required to mail proof of purchase, one clipped UPC code, and a pint of blood from your firstborn off to who-knows-where in order to actually claim the rebate. Often enough, the "who" in this equation is named Continental Promotion Group (CPB), a privately-held company that is currently the nation's largest processors of such rebates. (You may know them by their maiden name: "".)

Problem is, CPB is short of cash. Desperately so. Desperately enough so that it's been telling its customers (the folks who outsource their rebate processing to CPB) that if they don't ante up cash to pay its bills, then CPB won't pay out on their rebates.

Meaning, YOUR rebates
Fine, fine, you say. Sorry to hear about them, but what's all this go to do with me? And the answer is very simple. CPB doesn't have any money. So, if you ask them to give you the money you're owed on your rebate, they ... don't ... have ... any ... money!

Oh ...
Oh, indeed. And it gets worse. If you have already received a rebate from CPB and now want to cash it -- don't. Some sources suggest that trying to cash a rubber rebate check could get you hit with a non-sufficient funds (NSF) fee from your bank.

Now, I don't know about that, but depositing a valueless check could certainly mess up your checkbook accounting, with the result that you write a bad check of your own and then get hit with an NSF fee. And knowing how difficult it is to get a first rebate check from a processor, I shudder at the thought of trying to get a replacement from a bankrupt company after the bank eats your first copy.

But wait. How do I know if CPB is my processor in the first place?
Well, knowing that it's the biggest processor in the country suggests adopting a "better safe than sorry" policy. But just to be safe, let's run down a few of the companies that CPB purportedly does business with:

  • Activision Blizzard (NASDAQ:ATVI)
  • Bed, Bath & Beyond (NASDAQ:BBBY)
  • Canon (NYSE:CAJ)
  • Costco (NASDAQ:COST)
  • Home Depot (NYSE:HD)
  • Logitech (NASDAQ:LOGI)
  • Smith Micro (NASDAQ:SMSI)

Ring any bells?

Even if it doesn't, then just to be safe, check the mailing address on your rebate application. According to SlickDeals, if you're asked to send your rebate app anywhere in the vicinity of:

  • P.O. Box 52900
  • P.O. Box 52911
  • and/or Phoenix, AZ 85072-2900,

or if you're supposed to check the status of your rebate at, then you've got yourself a problem.

And the solution?
For now, hold on to your paperwork and sit tight. Wait for the situation to resolve itself, or if you're feeling proactive, then contact the retailer from which you purchased the dud rebate and ask their advice. Some retailers -- Costco, for example -- are already taking steps to fill the gap left by CPB's insolvency, offering to pay out rebates in-store. Others, such as Smith Micro, seem as confused as any of the rest of us and are basically telling consumers to wait until the companies figure out what to do.

Foolish takeaway
Meanwhile, take this Foolish advice to heart: Rebates were never worth what they purported to be. Today, they're worth even less than that. Just a word to the Foolish. 

Home Depot and Bed Bath & Beyond are Motley Fool Inside Value picks. Costco, Bed Bath & Beyond, and Activision Blizzard are Motley Fool Stock Advisor picks. The Fool owns shares of Bed Bath & Beyond. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Rich Smith does not own shares of any company named above. The Motley Fool's disclosure policy can be read on-demand, no snail mail required.

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Stocks Mentioned

Bed Bath & Beyond Inc. Stock Quote
Bed Bath & Beyond Inc.
$12.95 (21.82%) $2.32
Costco Wholesale Corporation Stock Quote
Costco Wholesale Corporation
$537.21 (0.94%) $5.01
The Home Depot, Inc. Stock Quote
The Home Depot, Inc.
$314.89 (1.35%) $4.20
Logitech International SA Stock Quote
Logitech International SA
$59.13 (1.97%) $1.14
Canon Inc. Stock Quote
Canon Inc.
$25.78 (0.82%) $0.21
Activision Blizzard, Inc. Stock Quote
Activision Blizzard, Inc.
$80.79 (0.35%) $0.28
Smith Micro Software, Inc. Stock Quote
Smith Micro Software, Inc.
$2.34 (-23.03%) $0.70

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